Friday, October 29, 2010

ORIGIN OF THE WORD "ECONOMICS"

The word "economics" is derived from a Greek word "okionomia", which means "household management" or "management of house affairs" -i.e., how people earn income and resources and how they spend them on their necessities, comforts and luxuries. With the passage of time, the word "okionomia" was used for an economy as whole in the sense that how a nation takes steps to fulfill its desires and preferences with the help of scarce means. That's why economics was called political economy in its early ages.

DEFINITIONS OF ECONOMICS:

-Economics is a science, which is concerned with those aspects of social behaviors and institutions that are involved in using the scarce resources to produce and distribute goods and services to satisfy human wants.

-The study of the problem of using available factors of production as efficiently as possible so as to attain the maximum fulfillment of society's unlimited demands for goods & services.

-The science that studies how scarce resources are allocated to meet competing and unlimited wants and how human beings satisfy their material wants and needs.

-The theory of economics does not furnish a body of settled conclusions immediately applicable to policy. It is method rather than a doctrine, an apparatus of the mind, a technique for thinking, which helps its possessor draw correct conclusions.

Definitions According to other Economists

According to Benjamin Davis
"Economics is the science that studies how scarce resources are allocated to meet competing and unlimited wants and how human beings satisfy their material wants and needs."

According to Bradely R. Schiller "Economics is the study of how best to allocate scarce resources among competing uses."

According to Jackson and Mclver
"Economics is concerned with the efficient use of limited productive resources for the purpose of attaining the maximum satisfaction of our material wants."

In simple words, economics can be defined as;

"Economics is the study of those natural laws which governs production, distribution and consumption of wealth; in economics we study that individual and social behavior of man which satisfy his desires and causes overall economic development."

Thee is no single definition of economics upon which all the economists are mutually agreed. Every definition is criticized by the different economists from different angles. Therefore it is difficult to describe the subject matter of economics in a few words, and proper definition of economics is still a question mark. That's why, perhaps, Keynes was not far wrong when he said "political economy is said to have strangled itself with definitions."